Topix Gets a $15M Vote of Confidence

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The corporate parents of news aggregator site Topix.net, Gannett, McClatchy and Tribune Co., so far haven’t done much since buying a controlling stake in the company in March 2005. While there have been minor uses – such as providing links to “related stories from the Web” in their online editions – the newspapers haven’t really been focused on what to do with this asset.

Now that they are all but compelled by circumstances and Wall Street to develop more effective online strategies, they’re waking up to the fact that they have something quite powerful in Topix, which claims to be a “top 25″ news site according to Hitwise data.

Over the course of the past year, Topix has built a rich community of forums and people commenting on news stories, with 2.5 million posts according to the site. It has also quietly been building a free classifieds listings database.

Now the newspapers seem to “get” Topix and have collectively invested another $15 million in the company. The question is: how do they effectively leverage the content and traffic to boost their fortunes. Here are some ideas:

  • Topix could help them syndicate their online classifieds and provide “backfill” for their own sites.
  • Topix could help them jump start their own community strategies, which is starting to happen. In the case of South Florida’s Sun Sentinel (scroll to the bottom), Topix is providing its platform to enable the paper to capture comments.
  • Topix could also distribute out its community content to newspaper partners’ sites.
  • Topix could enable newspaper sites to be instant news aggregators, like Google or Yahoo! Think: a tab or button that delivers a version of the full Topix site.
  • And, of course, Topix can drive even more traffic to newspaper sites.

Topix co-founder and marketing VP Chris Tolles told me that the money would be used in part to do more hiring, further develop the infrastructure and generally take the site “to the next level.” Tolles and Topix CEO Rich Skrenta are planning to do more to enhance the community features of the site – this is where they believe they’ve found a powerful differentiator. In addition, the company has always had a local news dimension that other news aggregators, until recently, have lacked.

The newspapers have always had difficultly managing and fully leveraging their verticals (e.g., CareerBuilder, Cars.com, etc.). Indeed, the online vertical brands have often soared while the newspaper parents’ have not. But integrating Topix content and functionality gives them another opportunity to get it right.

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Here are my previous posts on Topix and the newspapers.

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